On Wed, Sep 23, 2009 at 5:15 AM, Fred Jones <fredthejonester at gmail.com> wrote:
>>> Ok, so for those of you who disagree with hourly rates and tracking hours,
>> That's one reason we almost *never* do fixed-fee jobs
I come from a public sector consulting background. I worked for an
environmental engineering firm and for an IT consultant for the better
part of a decade. I worked on hundreds of presentations, proposals and
estimates in that time. Every single estimate was based on estimating
the number of employees and hours it would take to complete a job
based on the scope of work. Most projects required a project plan that
showed tasks, the number of employees and the rate for the employee's
services. All projects had a very well-defined scope of work and the
budget always contained a contingency and allowed for change orders
when the client decided to alter the scope.
All of this has carried over into my own business, and I firmly
believe the discipline I learned in doing those things over the years,
especially time tracking, has been extremely valuable. I track my own
hours and all of my subcontractors track their hours. All of our
proposals and estimates are based on the scope of work and hourly
rates. And I also include a contingency. Clients have a very easy time
understanding the project budget when you break things down into hours
for a particular task. IMO, the more clear and defined you can be in a
scope of work, the better off the project will be. But you also have
to include language that makes it very clear what happens when the
project goes beyond the scope.
Every big consultant out there, like Accenture, or your lawyer, bills
by the hour. They track time and they bill you accordingly. This is
how profit and loss, the bottom line for your business, is determined.
The more projects that you have going, the more vital it is to track
what you are doing, when you are doing it and who you are doing it
for.
All this being said, you have to do what is best for you and your situation.
--
Randal Rust
R.Squared Communications
www.r2communications.com
614-370-0036